Finland: Selected Issues
October 16, 2003
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In light of potential changes in fiscal policy in Finland, the impact of changes in the fiscal stance on short-term economic growth is an issue of interest. This paper estimates the short-term impact of fiscal policy on growth in Finland. The estimates are based on a structural vector autoregression (SVAR) model. However, identifying the long-term impact of changes in labor taxes on employment and growth is not an easy task. Although fiscal policy influences GDP in the short-term, the impact remains small compared with results.
Subject: Expenditure, Fiscal policy, Labor, Output gap, Potential output, Production, Unemployment rate
Keywords: CR, expenditure shock, GDP, GDP growth, HP estimation approach, HP filter, ISCR, Output gap, output gap measure, peak output gap, Potential output, production function approach, revenue item, Unemployment rate
Pages:
51
Volume:
2003
DOI:
Issue:
326
Series:
Country Report No. 2003/326
Stock No:
1FINEA0022003
ISBN:
9781451813210
ISSN:
1934-7685
